• A
  • A
  • A
  • ABC
  • ABC
  • ABC
  • А
  • А
  • А
  • А
  • А
Regular version of the site
Of all publications in the section: 1
Sort:
by name
by year
Article
Grigorieva S., Petrunina T. Journal of Management Control. 2015. Vol. 26. No. 4. P. 377-403.

Researchers have long tried to define the impact of corporate mergers and acquisitions on company performance. We contribute to the existing literature by examining the performance of M&A deals in emerging capital markets based on the economic profit model and comparing the results with ones obtained by means of traditional method—accounting studies. Examining a sample of 80 deals initiated by companies from emerging capital markets over 2003–2009, we find that M&As are value-destroying deals for the combined firms. Results from the long-run analysis prove the negative industry-adjusted differences between post-acquisition and preacquisition performance measures. The difference is equal to a significant −3.3% for the EBITDA/sales ratio. The economic profit approach demonstrates a similar result. Economic profit has declined due to M&A deals by $4 million. We also analyze the determinants of M&A performance, such as method of payment, business similarity, and type of geographical expansion (cross-border versus local deals).

Added: Oct 14, 2015